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Daily Market Lookup

  • Asian shares crept ahead on Thursday as a lull in the Sino-U.S. trade tussle and talk of more Chinese stimulus helped calm nerves, while tensions in the oil market grew ahead of an OPEC meeting that could expand the supply of crude. The mere absence of new threats from President Donald Trump on tariffs was enough to stem recent selling, with investors clinging to the hope that all the bluster was a ploy which would stop short of an outright trade war. Markets had also been encouraged by the People's Bank of China's move to set firm fixings for its yuan, along with the addition of extra liquidity. There was also much speculation the central bank would cut bank reserve requirements, thus boosting lending power in the economy. Sterling was pinned near seven-month lows at $1.3169 having made only a fleeting bounce after Prime Minister Theresa May won another crucial Brexit vote in parliament. The Bank of England holds a policy meeting later in the session but not a single analyst polled by Reuters expects a rate hike, and some are getting cold feet about a rise in August given recent soft economic data. While the European Central Bank has signaled an end to bond buying it also pledged to keep rates low past next summer, while the Bank of Japan shows no sign of winding back its stimulus.
  • The dollar took some steps back towards normalcy during morning trade in Asia Thursday, recovering its poise from the risk-aversion caused by elevated trade tensions between the U.S. and China earlier this week. Federal Reserve Chairman Jerome Powell said on Wednesday that the U.S. central bank should continue with a gradual pace of rate increases, which also supported yields. Powell said during a meeting of central bank chiefs in Portugal that trade tensions could cause damage to the global economy. The USD/JPY pair was up 0.21% to 110.59. Bank of Japan (BOJ) board member Yukitoshi Funo said on Thursday that the central bank needs to patiently continue its strong monetary easing under the current policy framework, emphasizing the central bank’s resolve to meet its 2 percent inflation target. Meanwhile, The USD/AUD pair rose 0.07% to 1.3582 Thursday morning. Reserve Bank of Australia governor Philip Lowe said at the Sintra meeting that tariffs alone will not derail global growth, but they could spark damaging market volatility and postponement of business decisions.  China’s Ministry of Commerce said on Thursday that the country’s Vice Premier Liu He will attend a trade summit with the EU next week, which will “send a positive signal between China and the EU to oppose unilateralism and protectionism and support the multilateral trading system.” Sterling managed to move away from the seven-month low after British Prime Minister Theresa May won a crucial Brexit vote in parliament, averting a rebellion that could have undermined her authority. But the bounce by the pound was limited ahead of the BoE's policy-setting meeting later on Thursday, which is expected to set the currency's near-term direction as the central bank weighs the prospects of a interest rate hike. The BoE is widely expected to stand pat and focus is on how strong the signals are for the possibility of rate increases at the next policy meetings in August and December.
  • Oil prices fell on Thursday as Iran signaled it could be won over to a small rise in OPEC crude output, potentially paving the way for the producer cartel to agree a supply increase during a meeting on Friday. However, prices were prevented from dropping further by robust U.S. fuel demand seen in record refinery runs, strong travel data and a large decline in crude inventories Iran, a major supplier within the producer cartel of the OPEC, signaled on Wednesday it could agree on a small increase in the group's output during a meeting to be held at OPEC's headquarters in Vienna on June 22 together with non-OPEC member but top producer Russia. Tehran had previously resisted pressure by OPEC's de-facto leader Saudi Arabia to raise output. Even with Iran appearing to fall in line, analysts do not expect a harmonious OPEC meeting. OPEC, together with other key producers including Russia, started withholding output in 2017 to prop up prices, but a tightening market in 2018 led to calls by major consumers for more supplies. In a sign of strong demand, U.S. refineries processed a seasonal record of 17.7 million bpd of crude oil last week, according to data from the EIA said on Wednesday. This comes as a record 46.9 million Americans are expected to travel during the upcoming July 4 holiday, according to the American Automobile Association on Thursday, which is seen as a leading indicator for U.S. fuel demand. Amid healthy consumption, commercial U.S. crude inventories dropped by 5.9 million barrels in the week to June 15, to 426.53 million barrels, the EIA said. U.S. crude oil production was flat week-on-week, remaining at a record 10.9 million bpd. Beyond the short-term, Barclays said there were headwinds for oil prices.

 

 
Intraday RESISTANCE LEVELS
21st June 2018 R1 R2 R3
GOLD-XAU 1,265-1,274 1,280 1,286
Silver-XAG 16.31-16.60 17.00 17.40-17.70
Crude Oil 65.70-66.30 67.00 68.10-69.00
EURO/USD 1.1600-1.1650 1.1700 1.1800
GBP/USD 1.3200-1.3260 1.3300 1.3360-1.3450
USD/JPY 111.00 111.50-112.00 112.70

Intraday SUPPORTS LEVELS
21st June 2018 S1 S2 S3
GOLD-XAU 1,260-1,251 1,240 1,236
Silver-XAG 16.00 15.60-15.30 14.80
Crude Oil 64.50-64.00 63.30 62.00
EURO/USD 1.1540-1.1490 1.1420 1.1370
GBP/USD 1.3145-1.3100 1.3025 1.2950
USD/JPY 110.50-109.90 109.00 108.50-107.60

Intra-Day Strategy (21st June 2018)
GOLD-XAU Sell on Strength
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Buy
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Wednesday made its intraday high of US$1276.33/oz and low of US$1267.59/oz. Gold was down by 0.520% at US$1267.84/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1326) and breakage below will call for 1316-1300. MACD is below zero line and histograms are decreasing trend and it will bring upward stance in the upcoming sessions. RSI is in oversold region and more downside is expected before it gets stretched. Stochastic Oscillator is in overbought territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Sell on Strength

Based on the charts and explanations above; sell below 1280-1311 keeping stop loss closing above 1311 and targeting 1274-1265 and 1259-1250. Buy above 1274-1250 with risk below 1250, targeting 1280-1289-1295 and 1305-1311.

 
Intraday Support Levels
S1     1,260-1,251
S2     1,240
S3     1,236
Intraday Resistance Levels
R1     1,265-1,274
R2     1,280
R3     1,286

Technical Indicators

Name   Value Action
14DRSI  

31.250

Buy
20-DMA   1296.00 Sell
50-DMA  

1305.59

Sell
100-DMA   1309.93 Sell
200-DMA   1303.04 Buy
STOCH(5,3)   20.129 Sell
MACD(12,26,9)   -5.329 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$16.53/oz and low of US$16.24/oz. Silver settled up by 0.0492% at US$16.26/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (16.77), breakage above will lead to 17.25-17.70. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in oversold region, indicating buy signal for now. The Stochastic Oscillator is in neutral region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.30-14.90 targeting 16.60-17.00-17.75 and 18.20-18.60; stop breakage below 15.00. Sell below 16.60-18.20 with stop loss above 18.20; targeting 16.60-16.30-16.00 and 15.60-15.00.

 
Intraday  Support Levels
S1     16.00
S2     15.60-15.30
S3     14.80

Intraday  Resistance Levels
R1     16.31-16.60
R2     17.00
R3     17.40-17.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.131 Buy
20-DMA   16.58 Sell
50-DMA   16.56 Sell
100-DMA   16.59 Sell
200-DMA   16.69 Sell
STOCH(5,3)   7.082 Buy
MACD(12,26,9)   0.0046 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$66.27/bbl, intraday low of US$64.72/bbl and settled down by 0.632% to close at US$65.24/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 61.15 which is a major resistance and breakage above will call for 62.20-62.80. MACD is above zero line and histograms are in increasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in oversold region and giving positive crossover for confirmation of bullish stance; while the RSI is in oversold region and more downside can be expected.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 65.70-69.00 with stop loss at 69.00; targeting 64.50-63.30 and 62.00-61.20. Buy above 64.50-61.70 with risk daily closing below 61.70 and targeting 65.70-66.30-67.00 and 68.10-69.30.

 
Intraday Support Levels
S1     64.50-64.00
S2     63.30
S3     62.00

Intraday Resistance Levels
R1     65.70-66.30
R2     67.00
R3     68.10-69.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.778 Sell
20-DMA   66.37 Buy
50-DMA   66.79 Buy
100-DMA   65.24 Buy
200-DMA   61.66 Buy
STOCH(5,3)   50.182 Sell
MACD(12,26,9)   -0.904 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1534/EUR, high of US$1.1599/EUR and settled the day down by 0.129% to close at US$1.1572/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.2164), which become immediate resistance level, break below will target 1.2150-1.2000. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently approaching oversold region and giving wards directions to consider buy.

Trading Strategy: Neutral to Buy

Buy above 1.1540-1.1370 with risk below 1.1350 targeting 1.1600-1.1650 and 1.1700-1.1800. Sell below 1.1600-1.1800 targeting 1.1540-1.1490 and 1.1420-1.1370 with stop-loss at daily closing above 1.1800.

 
Intraday Support Levels
S1     1.1540-1.1490
S2     1.1420
S3     1.1370

Intraday  Resistance Levels
R1     1.1600-1.1650
R2     1.1700
R3     1.1800

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.842 Buy
20-DMA   1.1685 Sell
50-DMA   1.1838 Sell
100-DMA   1.1949 Buy
200-DMA   1.1902 Buy
STOCH(5,3)   15.661 Buy
MACD(12,26,9)   -0.0065 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3146/GBP, high of US$1.3216/GBP and settled the day down by 0.037% to close at US$1.3166/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3953) is become major support level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is below zero line and histograms are decreasing lead to downward movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; short positions below 1.3200-1.3450 with targets at 1.3160-1.3100 and 1.3060-1.3000. Buy above 1.3145-1.3000 with targets 1.3400-1.3450-1.3550-and 1.3605-1.3700 with stop loss closing below 1.3160.

 
Intraday Support Levels
S1     1.3145-1.3100
S2     1.3025
S3     1.2950

Intraday Resistance Levels
R1     1.3200-1.3260
R2     1.3300
R3     1.3360-1.3450

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

28.244

Buy
20-DMA   1.3333 Buy
50-DMA   1.3507 Buy
100-DMA   1.3608 Buy
200-DMA   1.3541 Buy
STOCH(5,3)   9.000 Sell
MACD(12,26,9)   -0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY109.84/USD and made an intraday high of JPY110.56/USD and settled the day down by 0.443% at JPY1110.34/USD.

Technicals in Focus:

In daily charts, JPY is sustaining below 200DMA (109.62), which is major resistance on the daily chart. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is approaching overbought territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 111.00-112.90 with risk above 112.90 targeting 110.50-109.60-109.00 and 108.40-107.60. Long positions above 110.50-107.60 with targets of 111.00 -111.50 and 112.00-112.70 with stop below 107.60.

 
Intraday Support Levels
S1     110.50-109.90
S2     109.00
S3     108.50-107.60

INTRADAY RESISTANCE LEVELS
R1     111.00
R2     111.50-112.00
R3     112.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.834 Buy
20-DMA   110.66 Buy
50-DMA   109.46 Buy
100-DMA   109.24 Sell
200-DMA   109.66 Sell
STOCH(9,6)   57.297 Sell
MACD(12,26,9)   0.301 Sell

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